Duke refuses to cut ties with hedge fund president who's 'stripping' newspapers across the U.S.

Duke has accepted contributions from a hedge fund president and newspaper owner who has been slashing staff at profitable newspapers across the country. Now, a newspaper union wants the University to cut ties with him, but Duke isn’t budging.

Heath Freeman, Trinity ‘02, is a major donor to Duke and his family is the namesake of the Freeman Center for Jewish Life. His hedge fund, Alden Global Capital, owns Digital First Media—one of the largest newspaper chains in the country—and has cut staff at dozens of newspapers, including the Denver Post and San Jose Mercury News.

The NewsGuild-Communications Workers of America, the union representing workers at Digital First newspapers, has called for Duke to return donations from Freeman and remove him as advisory board chair of Jewish Life. The union and staff at Alden-owned newspapers say the donations are “dirty money” and undermine the mission of the journalism program at the DeWitt Wallace Center for Media and Democracy.

“It’s just shameful,” said Lisa Krieger, Trinity ’77 and a reporter at the San Jose Mercury News. “That is money that Alden Global Capital is taking away. Duke is profiting from it.”

NewsGuild representatives have made multiple unsuccessful attempts to meet with President Vincent Price to discuss the matter. Union president Bernie Lunzer first wrote to Price in early January, expressing his concerns about the University’s continued cooperation with Freeman, who donated more than $18,000 to the Jewish Life program in the 2016-17 fiscal year.

Price responded two weeks later through Michael Schoenfeld, vice president for public affairs and government relations, who said Duke is not affiliated with Alden Global Capital or Digital First Media. Schoenfeld suggested addressing any concerns with them.

Lunzer followed up with another letter Jan. 31, calling on the University to request Freeman’s resignation from the Jewish Life advisory board and to "consider a return of the most recent donation.” Lunzer said Schoenfeld’s response to his initial letter does a “disservice to the mission of the University.”

Despite additional letters sent by the NewsGuild and Krieger to professors and the Board of Trustees, Duke has stood by its position.

“The University is not affiliated with Alden Global Capital and has no role in its business decisions. You should contact them for further comment,” Schoenfeld told The Chronicle in an email.

Alden Global Capital’s cuts to Digital First newspapers have been felt across the country. Although its newspapers have continued to profit, Alden has laid off hundreds of reporters, including nearly a third of the Denver Post’s newsroom in March. The Post—which has lost more than 150 journalists in recent years—expects another round of layoffs Monday.

In an extraordinary response to the cuts, The Post’s opinion section blasted Alden in several articles Friday, calling executives at the hedge fund “vulture capitalists.” The articles urged Alden to sell the paper to someone who will actually support it.

Newspapers have struggled financially as the industry continues to lose advertising revenue with the decline of print. But the NewsGuild says Alden’s cuts are especially excessive, with the hedge fund eliminating reporter and staff positions at twice the national rate.

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Ken Doctor, a newspaper industry analyst at Harvard University’s Nieman Journalism Lab, said that unlike other newspaper companies, Alden is not investing in new digital revenue streams that can help its newspapers prosper. Rather, it is stripping them of assets and will later sell whatever remains of them.

Indeed, a recent lawsuit against Alden alleges that it siphoned off millions from its newspapers to also finance other insider investment deals.

“If you could see what this is doing to the papers that I’m aware of—the damage it’s doing—and perhaps putting businesses out of existence that did not have to go out of existence, it’s pretty sad,” Lunzer said in an interview.

Alden Global Capital and Digital First Media did not respond to requests for comment.

Freeman’s connection to Duke extends beyond his time as an undergraduate. His two older sisters graduated from the University before he joined the football team as a kicker and majored in sociology. While he was a student, his parents funded the construction of what is now the Freeman Center.

Freeman was named advisory board chair for Jewish Life in 2014 and he helped raise more than $35,000 for Jewish Life programs in 2016. Duke has also established the “Heath Freeman Football Internship Program," which lets Duke football players intern at Alden’s headquarters in New York.

The NewsGuild wants Duke to end the internship program and sever its relationship with Freeman. The union has cited other unrelated cases in which universities cut ties with donors over ethical concerns. The University of Colorado School of Medicine, for example, returned a grant from Coca-Cola because the gift was part of a company effort to question the relationship between sugary drinks, fast food and obesity.

Darren Carroll, a national field representative for the NewsGuild, said Duke’s refusal to meet with union officials to discuss the matter shows the school cares more about money than its mission to support journalism.

Lunzer added that the University is wrong to think that it’s not obligated to respond to Freeman’s business practices. Freeman’s contributions could be used to support a reporter’s job, he said.

“I know that Duke is intent on having a very good [journalism] program. And yet I believe it sends a very bad message to the very students who are trying to be journalists,” Lunzer said.

In addition to the NewsGuild’s attempts to meet with Price, the union has published articles and videos to raise awareness about Duke’s connection with Freeman. Carroll said the NewsGuild will continue to pressure the University by reaching out to students about the issue.

“To the extent that [students] agree and they think it’s important that this issue be brought to the attention of the administration in different ways…we would like to see that happen,” Carroll said. “We’re not going to stop.”

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